TOKYO: Japan's factory activity growth slowed in June due to China's strict COVID 19 curbs hurt manufacturers, keeping the economy underpowered and with few catalysts in the short run to spur a robust recovery.
The final PMI of the Jibun Bank Japan Manufacturing purchasing managers' index fell to a seasonally adjusted 52.7 in June from a final 53.3 in the previous month. The 50 mark separates contraction from expansion.
According to Usamah Bhatti, Economist at S&P Global Market Intelligence, the June PMI data pointed to a softer expansion of the Japanese manufacturing sector.
The health of the sector improved at the joint-slowest rate for nine months despite a stagnation in new order inflows and a slowing of output growth. The survey shows that orders for overseas orders contracted for the fourth month in a row. Input prices were at elevated levels, again rising faster than output prices, though firms passed on higher cost burdens to clients.
The survey showed rising price and supply pressures have held back activity in the sector, according to Bhatti.
The latest survey period slowed output and demand due to severe material shortages and delivery delays, he said.
The factory output tumbling at the steepest rate in two years in two years in May was highlighted by official data released on Thursday.